South African Inflation Expectations Stabilise

South African inflation expectations stabilised in the third quarter after a sharp increase earlier this year caused by Middle East energy disruptions, according to a central bank survey released Wednesday.

Respondents maintained their average 2026 headline inflation forecast at 4.4 per cent, matching second-quarter estimates.

Inflation measured 4.3 per cent year-on-year in July, keeping price growth squarely within the South African Reserve Bank’s 3 per cent target, which allows a one-percentage-point tolerance band on either side.

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Looking further ahead, surveyed analysts, business leaders, and trade union officials lowered their inflation projections for 2027 to 4.0 per cent and for 2028 to 3.8 per cent.

South African inflation expectations stabilise (News Central TV) — South African inflation expectations stabilise. Credit: Reuters

These medium-term expectations have a significant impact on central bank interest rate decisions because monetary policy actions take 12 to 24 months to fully affect the economy.

Following a rate hike in May and an unexpected hold in July, policymakers will announce their next interest rate benchmark on September 23.

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Abisoye Adeyiga

Abisoye Adedoyin Adeyiga holds a PhD in Languages and Media Studies and a Master’s in Education (English Language). Trained in digital marketing and investigative journalism, she is passionate about new media’s transformative power. She enjoys reading, traveling, and meaningful conversations.